The above quote from Warren Buffett is timeless, and brings into focus the choice about time horizon that any investor should think about before buying a stock they are considering. Behind every stock is an actual business; what will that business look like over a five year period?

Today, let’s look backwards in time to 2015, and take a look at what happened to investors who asked that very question about Ulta Beauty Inc (NASD: ULTA), by taking a look at the investment outcome over a five year holding period.

ULTA 5-Year Return Details

Start date:

05/08/2015

$10,00005/08/2015

$14,39905/07/2020

End date:

05/07/2020

Start price/share:

$154.29

End price/share:

$222.16

Starting shares:

64.81

Ending shares:

64.81

Dividends reinvested/share:

$0.00

Total return:

43.99%

Average annual return:

7.56%

Starting investment:

$10,000.00

Ending investment:

$14,399.28

The above analysis shows the five year investment result worked out well, with an annualized rate of return of 7.56%. This would have turned a $10K investment made 5 years ago into $14,399.28 today (as of 05/07/2020). On a total return basis, that’s a result of 43.99% (something to think about: how might ULTA shares perform over the next 5 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]

Here’s one more great investment quote before you go:“All the opportunity in the world means nothing if you don’t actually pull the trigger.” — Sam Zell